Britain slashes economic growth forecasts

LONDON (AFP) - Britain slashed its economic outlook on Wednesday, forecasting the economy would shrink by 0.1 per cent this year and then return to growth in 2013, according to figures published alongside a budget update.

The new forecast, issued by the Office for Budget Responsibility fiscal watchdog, compared with the prior 2012 growth estimate of 0.8 per cent that was given in the annual budget in March.

The watchdog added that British gross domestic product was forecast to grow by 1.2 per cent in 2013. That compared with previous guidance for greater expansion of 2.0 per cent.